Is EPA Cutting Ethanol Needs?

At least one news service is reporting that EPA is proposing a big cut in the ethanol mandate.

Oct 11, 2013

The wrangling over the Renewable Fuel Standard may be entering a new phase if news from Reuters is correct. The news service is reporting - based on internal documents - that the U.S. Environmental Protection Agency will cut the volume of ethanol to be blended in U.S. gasoline in 2014.

The cut is as high as 6% bringing down the needed ethanol volume to 13 billion gallons, Reuters reports. And the overall renewable fuel requirement could fall to 15.21 billion gallons, the report goes on to say.

CHANGING LIMITS: EPA may be tweaking the Renewable Fuel Standard, but that may not be possible.

The RFS has been under significant pressure from the petroleum industry lately, including a new lawsuit challenging the 2013 cellulosic ethanol mandate, with the American Petroleum Institute is calling unrealistic.

In a blog posted today by Bob Dinneen, Renewable Fuels Association, notes that any leaked draft document "does not represent a final determination and has not yet been subjected to interagency review," he notes.

One key area of contention Dinneen sees is the renewable volume obligations that some say may be adjusted to move beyond the "status quo and blend volumes of renewable fuel above the so-called 'E10 blend wall,'" Dinneen says. His blog notes that EPA must meet specific conditions to provide a waiver beyond what is mandated by law. He says that the difference between the total renewable fuel volume and the advanced biofuel standard - 14.4 billion gallons for 2014 - cannot be affected by any adjustments made by EPA under the waiver authority.

He notes that the petroleum industry has been asking EPA to take into account the E10 blend wall and market limitations "to the consumption of ethanol in gasoline blends above E10." Dinneen asserts that market limitations are not among the statutory requirements available to EPA. In a blog with plenty of legal assertions, Dinneen shows how EPA must move ahead without a waiver that would reduce ethanol use.

As the EPA documents Reuters is covering come to light, this debate may continue. More details are needed before final numbers can be worked out.